Heavy Louisiana Oil Gains as Exxon Shuts Pipe ‘Indefinitely’

Nov. 14 (Bloomberg) -- Heavy Louisiana Sweet oil has risen
to a premium over Light Louisiana Sweet since Exxon Mobil Corp.
shut a portion of its Southwest Pipeline System from South Bend
to Sunset, Louisiana.

The line was shut “indefinitely” Oct. 31, according to an
Oct. 21 bulletin sent to shippers obtained by Bloomberg News.
The pipeline helps carry Heavy Louisiana Sweet oil, according to
the company’s website.

The 12-inch pipeline carries oil from South Bend to Krotz
Springs, Patricia Errico, an Exxon spokeswoman, said in an e-mail. Exxon made alternative arrangements available for
customers before the closure, she said.

Exxon shut the pipeline after a special permit application
seeking to “modify repair criteria” on the segment was
rejected, according to the spokeswoman.

Alon USA Energy Inc. shut its 83,000-barrel-a-day Krotz
Springs refinery for upgrades that will improve the capacity of
the plant’s fluid catalytic cracking unit and its ability to
handle different grades of crude, the company said in a Nov. 3.
statement.

Alon said it expects to finish work during the first half
of this month and that throughput will exceed 62,000 barrels a
day in the fourth quarter.

Heavy Louisiana Sweet has climbed to a premium of $1.65 a
barrel over Light Louisiana Sweet from a discount of 70 cents on
Oct. 31, according to data compiled by Bloomberg.